London First on the opportunities and challenges the new government offers the capital

May 8, 2015

London First’s policy experts have given their initial responses to the opportunities and challenges the new government offers the capital.

EU referendum

Dr David Lutton, Director of Competitiveness and Financial Services Policy at London First, said:

“Our members are almost unanimous in wanting the UK to remain at the heart of the European economy. One of the things that makes London such an attractive a location for global companies is that it is the business capital of the world’s biggest and richest single market. What is needed now is sensible and rational debate ahead of a referendum so that the public have all the information they need to make an informed choice – and business leaders have a strong role to play in that debate.”

Immigration

Mark Hilton, Director of Immigration Policy at London First, said:

“We remain concerned that the Conservatives’ welcome focus on competitiveness is undermined by their rhetoric on immigration. Having dramatically failed to meet their net migration target over the last Parliament, the fear is they’ll throw the kitchen sink at trying to achieve it this time, and in the process limit access to the global talent we desperately need.

“As a priority, the new government needs to remove international students – a £10bn export market for the UK – from its target.

“We’re increasingly seeing foreign students turning to places such as America, Canada, and Australia because they don’t think they’re welcome here.

“That’s why it is so vital for the new government to send a message that Britain is welcoming to foreign talent and investment, both from Europe and beyond, and is open for business.”

Housing

Jonathan Seager, director of housing policy at London First, said:

“It’s vital that a Conservative government gives housing the priority it needs. Nimbyism has been allowed to run riot for far too long: the result is that we now have a housing crisis, especially in London. In fact, three-quarters of businesses now believe that the lack of new homes and rising housing costs are a significant risk to the capital’s economic growth.”

Airport expansion

Gavin Hayes, Director of Let Britain Fly, said:

“The Conservatives have already pledged to ‘respond’ to the Airports Commission, but they now need to go further and commit to concrete action.

“There have already been decades of dithering over expansion, and with Britain already suffering from airport capacity problems, business needs the findings of the Conservative-established Airports Commission to be implemented as a top priority for the new Government.

“Doing nothing is not an option.”

Bank levy

Dr David Lutton, Director of Competitiveness and Financial Services Policy at London First, said:

“A Conservative government needs to take stock of HSBC’s recent announcement that it is considering relocating its global headquarters to Asia. The burden of increasing regulatory costs with the bank levy – an uncertain and unstable tax – potentially create a tipping point that puts our status as a global financial status under threat. Removing the unpredictability of the tax rate would reduce its burden, and this should be the first step towards its removal altogether, once economic conditions allow.”

Infrastructure

David Leam, Director of Infrastructure Policy at London First, said:

“A Conservative government provides continuity on the essential transport investment a growing London needs. The reference to Crossrail 2 in the Conservative manifesto was a particularly welcome recognition of the need to plan ahead for the capital’s continued growth.”

Why did Labour do so much better in London than elsewhere?

Labour has increased its control of London, taking 45 of the capital’s 73 Parliamentary seats, despite heavy losses elsewhere in the UK.

John Dickie, director of strategy, explains why the party bucked the trend in the capital :

“Part of Labour’s success in London is down to demographics – the party gets more support from migrant and ethnic minority voters, which have been growing sections of the capital’s population.

“London’s population is also younger than other parts of the country and polls show younger voters tend to identify with Labour. And of course EU membership is much more popular in London too.”